Question And Answer
Subject: Sec.271D penalty
Querist: Neha
Answered by:
Tags: ,
Date: April 29, 2023
Query asked by Neha

During the course of assessment proceedings,  AO notice that in some loan transcation assessee has accepted loan in Cash and assessee has also given confirmation from the lender that he is assesssed to tax and disclosed the transcation in his books of accounts. Assessment U/Sec. 143(3) was completed on 31.03.22 by accepting  Returned income. There is no mentioned about contravention of provisions of Sec. 269SS of the Act.

On 10.05.2022, he made a reference to Joint CIT about contravention  ofprovisions of sec. 269SS and initiation of penalty proceedings u/Sec. 271D of the Act. The JCIT o  10.06.22 initiated penalty proceedings and sent a show case notice asking the assessee as to why penalty should not be levied for contravention of provisions of Sec.269SS.

Assessee has replied that since the AO has made reference to JCIT for initiation of penalty proceedings U/sec. 271Dafter completion of assessment proceedings , penalty proceedings initiated by JCIT is bad in law.

Whether assessee view is correct ? If yes, are there any judicial support for this contention.

Pl guide


File Uploaded: Not Available

The view is not correct. Penalty proceedings under section 271D of the Act are independent of assessment proceedings. The issue will have to be dealt with on merits.

Disclaimer: This article is only for general information and is not intended to provide legal advice. Readers desiring legal advice should consult with an experienced professional to understand the current law and how it may apply to the facts of their case. Neither the author nor and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any inaccurate or incomplete information in this article nor for any actions taken in reliance thereon. No part of this document should be distributed or copied (except for personal, non-commercial use) without express written permission of

Leave a Reply

Your email address will not be published. Required fields are marked *